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Hi, María Here. Today I am sharing some tips to eliminate your credit card debt, NEW YEAR, NEW Resolutions, hope it will help you.

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Credit Card Debt

Credit card debt is a major problem in this country. While not everyone has a credit card, those that do typically carry a balance. The interest rate on a credit card balance is usually between 10-30% APR. These high interest rates make it difficult for people to pay down their debt -- especially if only making the minimum payment. In fact, just making minimum payments can make even the smallest balance over a decade to pay off and thousands of dollars in finance charges. It’s no wonder getting out of debt seems so hard.

Fortunately, you can get out of debt. If you follow a few basic steps and put a plan in place, you can work to pay off your debt sooner, with less interest, and improve your credit score in the process.

1.First, list each of your credit cards. You’ll want to include the outstanding balance, interest rate, and minimum payment. This information can easily be found on your last monthly statement.

2.Order the cards on the list so that the credit card with the highest interest rate is at the top, and the lowest is at the bottom.

3.Total the minimum payments.

4.The total monthly minimum is your absolute lowest monthly payment, but remember, we want to pay more than the minimum in order to repay the debt quickly. So, take a look at your budget and see how much extra you can come up with each month in addition to the minimum. Whether it’s an extra $20 a month or $100, every little bit helps.

5.As your payments come due, pay the minimum on each card except for the one at the top of your list. Remember, that one has the highest interest rate and it costing you the most money by maintaining a balance. So whatever additional money you budgeted in the previous step, apply that to that card.

6.Continue this process until the first card is paid off. When that card is paid off, continue with the minimum payments on the other cards, but now take the amount you were paying on the first card in addition to the minimum payment and apply it to the second card on your list.

7.Repeat this process until all cards are paid off.

Why This Works

To understand why a relatively simple process works it’s important to understand how minimum payments work. Minimum payments are calculated as a percentage of the outstanding balance. That means as your card balance slowly decreases, so does your minimum payment. This is why it can take ten years or more to pay off even a small balance if you only make the minimum payment each month.

With this system, your monthly payment is remaining constant regardless of your balance. So each month your required minimum payment may go down, but you’re ignoring that and by doing so you apply more and more money to your principal as time goes on, thus accelerating your debt repayment.

Starting with the highest interest rate ensures you’re targeting the most costly credit up front to minimize the total amount of interest you pay.

A Few More Tips

While this payment strategy will help you get out of debt, you can potentially make things go even faster with a few other tips. First, call your credit card company and ask about getting your rate lowered. This won’t always work, but if you have been on time with your payments and a decent credit score, they may be willing to work with you. It doesn’t hurt to try and it doesn’t cost anything. The worst they can do is say no.

Don’t forget about balance transfers. Again, it isn’t always easy to get credit and the balance transfer deal may not be the best, but if you can find a way to transfer the balance from a card with a 25% APR to a card with an 18% APR, that’s still something. There may be some special 0% offers as well, but they are harder to come by these days and the hidden fees may outweigh the benefit.

Finally, keep in mind that this process still takes time. There is no magic method of paying off debt, so realize that it will still take months or even a few years to become completely debt-free. But what we're doing is putting a process in place to make sure that you can get out of debt as soon as possible. You can speed up the process if you continue to pay even more money towards your debt as your budget allows.

Have a great day!

María

www.fx-megaforex.com

Smart solutions for your professional trading.

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Hi María here, I found this article at yahoo, and I want to share it with you hope it will help you understand things better.

Until now, many Americans have largely tuned out Europe's debt crisis. Its causes are complicated, it's happening somewhere else, and we've got enough of our own economic problems to worry about, thank you very much.

But Americans may not be able to disregard the crisis much longer. Europe's leaders met in Washington over the weekend, trying to devise a plan to finally address the growing financial emergency. And U.S. government officials are using increasingly urgent language in their appeals to their European counterparts to come up with a viable plan before the crisis spirals out of control, plunging the global economy back into recession.

So it's time to start getting familiar with Europe's debt crisis. Here's the crucial background you need to know:

How and when did the crisis originate?

Let's start back in 2001, when 17 European countries scrapped their national currencies and replaced them with the euro. The new "eurozone" bloc permitted some of its economically weaker members to borrow money more cheaply than they 'd been able to do previously, because they benefited from the higher credit ratings of the region's stronger economies.

As a result, many European countries, including Greece and Ireland, began to take on debt. (In Greece's case, by the way, this effort was aided by Goldman Sachs, which, for a fee, came up with a clever way to allow Greece to disguise the extent of its borrowing). By early 2010, investors began to worry that those two countries, and also Portugal, might not be able to repay their obligations.

Details of the financial meltdowns have varied from country to country. In Greece, the problem was a culture of tax evasion, combined with excessive public spending. (As Michael Lewis of Vanity Fair wrote recently, to get around pay restraints in the calendar year, "the Greek government simply paid employees a 13th and even 14th monthly salary--months that didn't exist.")

Things got worse, of course, with the global economic downturn, which reduced revenues further. In Ireland, the debt was largely a result of the government guaranteeing the nation's largest banks, which were threatening to collapse after financing a housing bubble--a familiar scenario to any jaundiced observer of Washington's lavish bailouts of U.S. investment banks. Portugal's public debt was in fact far lower, but investors lost confidence anyway, in part because of relatively high levels of government spending and intervention in the economy.

The markets' fears created a vicious cycle. Once investors decided that those countries might not be able to repay their debt, it became much more expensive for those governments to finance new borrowing. And the credit squeeze in turn made it less likely that the cash-strapped governments would ever be able to repay the original debt, raising the prospect of a default.

Sounds scary. What have European leaders done in response?

Greece last year won a $154 billion bailout from the European Union and the International Monetary Fund. The rescue package required the Greek government to undertake a series of harsh budget-slashing austerity measures. Those cutbacks have prompted widespread protests in Athens that at times have turned violent. Ireland and Portugal received their own bailouts, worth $115 billion and $105 billion respectively.

But especially in Greece's case, the bailout and belt-tightening haven't been enough to convince investors to loan money at more reasonable rates or to ease fears of a default. So in July, European leaders committed an additional $600 billion to create the European Financial Stability Facility--essentially, a bailout fund for whichever European countries need it. The idea was to remedy the worst of Europe's financial woes by creating a "fence" around its most troubled economies.

But even that plan, which has yet to win approval from Europe's member states, so far hasn't succeeded in calming financial markets. And thanks to a lack of political consensus combined with Europe's unwieldy decision-making process, any new plan likely won't go into effect for several weeks or more. And that might be too long for Greece to hold out.

So if Greece is the only economy at risk, what's the big deal?

It's not. The fear is that the Mediterranean country's troubles could spread to other eurozone members, by reducing investor confidence more broadly. Based on the market's behavior, it's not just Ireland and Portugal either: Italy and Spain--the third and fourth largest economies, respectively, in the eurozone--also now appear to be in the firing line.

Italy's public debt to GDP ratio is 120 percent, one of the highest in the world, and the country is plagued by anemic growth and a chronically dysfunctional political system. (Its prime minister is currently being investigated in connection with alleged encounters with a 17-year old prostitute.) Spain had the world's biggest real estate bubble--it had as many as 1.1 million unsold homes at the start of the year. And both countries, like Greece, have been forced to adopt strict and unpopular austerity measures.

One analyst recently likened the situation to the 2008 failure of Lehman Brothers, which sparked the near-collapse of the entire financial system. "You were concerned if Lehman went, how many other banks would go," Hans Lorenzen, a credit strategist at Citigroup, told the Washington Post. "If Greece defaults, what's the probability of Portugal and Ireland and then Italy and Spain?"

Even relatively healthy economies aren't thought to be safe. European banks--led by those in Germany and France--hold a total of 54 billion euros of Greek debt. Earlier this month, credit ratings agency Moody's downgraded the ratings of two large French banks, citing concerns over their exposure to Greek debt.

Have a great day!

María

www.fx-megaforex.com

Smart solutions for your professional trading.

.